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  • Kinder Morgan: Some Good News And Some Bad News  [View article]
    Morningstar would not know a MLP from a kangaroo. Thier metrics are not set up to give meaningfull info on ANY MLP.
    Mar 17, 2014. 10:21 AM | 6 Likes Like |Link to Comment
  • Enbridge Energy Partners: A Play On Canadian Oil Shale Primed For Growth  [View article]
    Adam - Interesting article. A favor - put something in all your articles about how MLPs are different come tax time. The primer at NAPTP.ORG called MLPs 101 is great.

    The only premise I find difficult to accept is using a 7.1% average yield for EEP. That time includes some of the meltdown time for MLPs and distorts the real picture and a lower number would be more representative. I do agree that EEP is a comeback story with investent grade and they now have things moving nicely. The problem today is their terrible record of pipeline leaks and their flat distribution record. There are also other companies that are turning thnigs around. ETP. NS, BPL are three that had flat DCF numbers and falling coverage and are now doing better. EEP is certainly a work in progress and a pretty safe place to put money as long as we do not get a big spike in interest rates.
    Mar 17, 2014. 12:01 AM | 1 Like Like |Link to Comment
  • Enterprise Products Partners: Buy Ahead Of The March 18th Analyst Day  [View article]
    Am very confused.

    You state EPD has both a 6.4% CAGR over the last 10 years and an 8% CAGR. The bottom line here is EPD has changed its model for distribution of cash to increasing by .01 per quarter and reviewing the preformance annually in a July/August BOD meeting for a possible special payout/increase. You commdent on this and if they do this the CAGR will slowly decrease over time toward 5%.

    As for analyst day - what is going to be said that is new? EPD has a long track record (for MLPs) of bringing projects in on time and within the panned cost levels. ATEX and Seaway are progressing and EPD has already announced increased propane exports. Since EPD has not historically announced anything new project wise at these meetings,; why would this provide reason for the unit price to move up significantly?

    EPD is a conservative company operated in a conservative way. They have billions worth of projects available and seek out those with a strong and generally fixed fee type of return in the 15% area. EPD has financing in place at fixed rates for many many years into the future and we will see similar growth in the coming years.

    The only issue the EPD and other MLPs are going to face is rising interest rates. This will effect EPD via alternative investments having higher returns and EPD therefore needing to have a higher yield. The good part about EPD, as you have said, is there huge amount of retained cash. When rates eventually rise, EPD can increase its distribution to maintain their unit price. A luxury that other large MLPs like KMP do not have.
    Mar 16, 2014. 07:56 PM | 2 Likes Like |Link to Comment
  • U.S. Natural Gas Stores Are Dangerously Low, That's Good For Pipeline And Storage Companies  [View article]
    David - Suggest you read MattZNs comments and try to make sure you stay away for any discussion of global warming or cooling. Neither has any meaning related to NG storage in the shorter or even the next few years. NG storage is related to WEATHER and not CLIMATE. Big difference.

    Good luck!
    Mar 16, 2014. 12:05 PM | 2 Likes Like |Link to Comment
  • U.S. Natural Gas Stores Are Dangerously Low, That's Good For Pipeline And Storage Companies  [View article]
    How in the heck did you ever allow the stupid bantering about global warming. A waste of time and energy as that was not the issue.

    I disagree that LNG is going to have an impact in the shorter term since we are not going to export anything significant except to Mexico in the short term. I agree that dry gas producers - particularly in OK/KS/TX - cut back when prices went to $3mmbtu but those producers are all producing today. In the longer term prices in the $5-7 range are indeed reasonable as anything above that and LNG exports are not competitive from the US and below that they become ever more attractive.

    The issue today is not price, but rather the lack of a market for ethane and generally low NGL prices. Almost all shale gas is wet gas and producers are getting little price uplift due to enthane bypass in processing. takeaway is also an issue both from wells - most Utica wells have no delivery system as of 2/1/14 - and pipelines to deliver gas to power plants. We are in a risis mode in the NE pool grid as so many existing older plants have been shut down and the ability to acquire NG is constrained so much; that plants often do not have enough gas.

    Also read MattZN2s comment. He has stated backwardation perfectly. To say it one more time. I would be stupid to put my $4.50 gas into storage and pay $.50 to store it and then look at selling it for $4 next fall or winter. Better to sell it now!
    Mar 16, 2014. 12:01 PM | Likes Like |Link to Comment
  • Weekly Intelligence For MLP Investors  [View article]
    keltus - Not sure what FEI and the others send you, but I get a statement of the classification of my dividends, not a K-1. Opening the envelopes might be a good idea. If you actually got K-1s inside your IRA you still could owe UBTI taxes on MLPs. Do not fret, none of those yuo mentioned are MLPs and all pay dividends.
    Mar 16, 2014. 11:46 AM | Likes Like |Link to Comment
  • Weekly Intelligence For MLP Investors  [View article]
    wm/Mike - If you use Turbo Tax you simply enter the numbers from your K-1 in the interview. Same thing if you sell all of your units. The only complication is a sale of part of your units. Bottom line there do not do it.

    The IRS is not likely to ever have a tax question on a K-1. They have no more clue of the vague regualtions and arcane law than you do. I would suggest that about $75 per K-1 for some clerk to enter the data into a computer using a program almost exactly the same as Turbo Tax is a waste of lots of money.

    FWIW I have most of my assets in MLPs for over 20 byears now and own over 20. Is it worth the 4 hours it took me to enter the K-1 data to save $1450? Absolutely. Is having someone to sit with me during and audit worth the $1450? No, but if I was concerned TTax offers audit assistance guarantee for about $50. I also suggest that few accountants or even CPA have much of a clue on MLPs.
    Mar 16, 2014. 11:42 AM | 6 Likes Like |Link to Comment
  • Weekly Intelligence For MLP Investors  [View article]
    The section on mutual fund flows is excellent. Only suggestion is a short disclaimer that before investing in a MLP every investor should understand the tax consequences of MLPs. The primer at National Association of Puiblically Traded Partnership called MLPs 101 is excellent.

    Thanks again.
    Mar 15, 2014. 04:05 PM | 4 Likes Like |Link to Comment
  • ModernGraham Quarterly Valuation Of Freeport-McMoRan  [View article]
    Good analysis and comments. FCX and all the other metals producers had a disaster beyond their control in 2008 with the financial meltdown. Doesn't the Graham model provide for situations like what happened to miners in 2008?
    Mar 14, 2014. 11:16 PM | 1 Like Like |Link to Comment
  • Enterprise Products Partners Is All Set To Grow  [View article]
    Am very confused by your comment that EPD - "has a substantial acreage in the shale plays". You sort of make it sound like EPD is drilling wells, but intead is a gather and processor in those fields with production dedicated to EPD for defined terms.

    Also a bit strange to suggest it is going to grow in a signifant manner. Yes, $5B is huge but EPD has an enterprise value of approximately $80B. Thus $5B is only a 6% increase.

    The other comments about increasing export of propane, great long term financing and the insets on its assets are right on. More infrastucture is needed and 2014 will put in place more assets than in 2013 with even more projected for 2015. Opportunity abounds, but EPD continues to do it in a reasoned controlled manner.

    Last, potential investors need to remember there are significantly different tax ramifications when you own a MLP. Reading a bit on MLPs at the National Association of Publically Traded Partnerships and their MLP 101 primer should be required before investing as K-1s are not for everyone.
    Mar 13, 2014. 05:36 PM | 5 Likes Like |Link to Comment
  • Magellan Midstream Partners: The Best MLP In America Is Trading At A Discount  [View article]
    The fundamental calculations and assumptions need some significant work. There is also the simple fact that other higher yielding MLPs provide a floor based on the yield, while MMP would be negatively impacted by an increase in interest rates which would offer competition from alternative investments.

    Using your 11% threshhold as a place to invest would not RNO with its current 14.2% distribution and with the recent sale a situation on no long term debt be a good investment? 5 years at 14.2% equals a gain of 94% with a possibility/probability of the distribution increasing during that 5 years. Is this likely to be as good or better than MMP? My assumptions for RNO are for no increase in distribution or appreciation in unit price and the GP continuing status quo. Cash flow from the new operations and/or expansion into new ventures could provide a resumption of DCF/distribution growth in ther future. I also assue we are not going to stop using coal and the current low pricing will not get worse because smaller/more leveraged operators continue to go out of business.
    Mar 12, 2014. 05:39 PM | 1 Like Like |Link to Comment
  • Boardwalk Pipeline Partners: Is There Anything To Be Salvaged From This Fiasco?  [View article]
    Von - Suggesting looking at Kinder as a model either in the past or future is not really a good idea. KM has significant issues with only about a 1.5-1.9% increase from its existing asset base and greatly slowing CAGR. They have absolutely no reserve margin with $22M out of Billions for retianed cash. Richard is also the one that took out the public when he took KMI private, made huge $$ and then sold it back.

    I agree BWP is dead money for several years and not a buyout possibilty as L owns most of BWP.
    Mar 12, 2014. 12:08 PM | 1 Like Like |Link to Comment
  • U.S. Natural Gas Stores Are Dangerously Low, That's Good For Pipeline And Storage Companies  [View article]
    David - The global warming issue is one I do not care to tackle. Good analysis but a couple of problems in your basic thesis.

    NG prices are lower in the future than today. This has made NG storage lower and not profitable for the last six to 9 months - NOT more profitable. No company is going to pay to store gas that is likely to be worth less in the future.

    Your comments on infrastucture are correct. Billions is being spent on everything from gathering to processing to transportation by companies including the KM family and EPD. It is a bit of a stretch to call EPD a pipeline company as it gets most of its $$ from processing, storage and now a growing exporting of propane. That said, much of the problem with spot prices of NG have been created by the stupid regulators and people who forced the closure of coal generating plants without having an alternative in place. Great to shut down an older coal plant for NH, but unless your new NG peaker has a pipeline and guaranteed supply of NG you are likely to be a bit cold and dark!
    Mar 10, 2014. 10:36 AM | 6 Likes Like |Link to Comment
  • Why Not Purchase This 7.5% Yield MLP For The Long Term?  [View article]
    APL has had an increase in price of almost zero in the last 4 years. Looking at APL when it was near BK in 2008/9 after having decreased in price from about $60 to under $5 is really misleading top suggest it has outpreformed in the last 5 years. Take a look at some of the best MLPs including EPD, KMP, PAA, MMP and others and in relation to these APL has not done well. After cutting their distribution in a near BK they are now up to about 65% of where they were 6 years ago!

    Is APL one of the weaker MLPs - yes. Is it worth holding at the current approximately $30 unit price - yes. But the reason for its large yield is that is has continually given guidance in the last couple years and fallen short. 3 months ago they agreed to have thier GP waive IDRs from the .65 to .70 per quarter payout and APL suggested they would increase in the next quarter to the .65 threshold after they missed for Q3 of 2013. For last quarter another miss and guidance now pushed out till 2014YE.

    APL sadly has lots of KW abnd POP contracts and issues with gas volumes. They are worth buying at this level for those that are VERY VERY patient, but APL has a long history of being mismanaged.

    Suggesting the 8% yield is a reason to invest before APL finds a new bottom is really bad advice. Investors instead should ask why APL is not increasing its distribution and the others are. Investors should ask why APL is yielding that amount if it is such a great company.

    FWIW - I first bought APL in 2000 at about $20. It is in the bottom 1/3 for $$ amount of my MLP holdings.
    Feb 19, 2014. 02:06 PM | 10 Likes Like |Link to Comment
  • Seadrill's Path To Problems  [View article]
    Lots of people do not understand MLPs including M* and Zacks. And oh yes, forgot to include our author.
    Feb 19, 2014. 11:43 AM | 2 Likes Like |Link to Comment